Bâloise : Earnings Document

Corporate Governance

Corporate Governance Report 33

1. Structure of the Baloise Group and

shareholder base 34

2. Capital structure 35

3. Board of Directors 37

4. Corporate Executive Committee 46

5. Remuneration, shareholdings and loans 48

6. Shareholder participation rights 48

7. Changes of control and poison-pill measures 49

8. External auditors 49

9. Information policy 50

Appendix 1: Remuneration Report 53

Appendix 2: Report of the external auditor for the

Annual General Meeting of Bâloise Holding Ltd, Basel 77

Corporate Governance Report

Baloise is a company that adds value, and, as such, we attach great importance to practising sound, responsible corporate governance.

Operating in line with the requirements of economiesuisse's Swiss Code of Best Practice and the SIX Swiss Exchange Corporate Governance Guidelines, Baloise strives to foster a corporate culture of high ethical standards that emphasises the integrity of the Company and its employees. Baloise firmly believes that high-quality corporate governance has a positive impact on its performance.

This chapter reflects the structure of the SIX Corporate Governance Guidelines as amended on 29 June 2022 in order to improve comparability with previous years and with other companies. It includes the requirements of economiesuisse's Swiss Code of Best Practice for Corporate Governance, which contains recommendations on the remuneration paid to the Board of Directors and the Executive Committee. In item 5 of its Corporate Governance Report, Baloise publishes the principles used to determine the content and scope of the disclosures on remuneration in the Remuneration Report (Appendix 1 to the Corporate Governance Report, page 53 onwards).

The information contained in the Corporate Governance Report refers to the situation on the balance sheet date (31 December 2022). Additional reference is made to material changes occurring between the balance sheet date and the print deadline for the Annual Report.

Sustainable business management plays an important role at Baloise. In addition to the information provided in the Corporate Governance Report, governance structures - both general and relating to specific areas - are described in more depth in the sustainability section of the Company's Annual Review.

1. Structure of the Baloise Group and shareholder base

Structure of the Baloise Group

Headquartered in Basel, Switzerland, Bâloise Holding Ltd is a public limited company that is incorporated under Swiss law and listed on the Swiss Exchange (SIX). The Baloise Group had a market capitalisation of CHF 6,535.7 million as at 31 December 2022.

• ● Information on Baloise shares can be found in the Annual Review from page 40 onwards.

• ● Significant subsidiaries, joint ventures and associates as at 31 December 2022 can be found from page 226 onwards in the notes to the consolidated annual financial statements, which form part of the Financial Report.

• ● Segment reporting by region and operating segment can be found from page 165 onwards in the notes to the consolidated annual financial statements within the Financial Report.

• ● The Baloise Group's operational management structure is presented on page 48 onwards.

Shareholder base

As a public company with a broad shareholder base, Bâloise Holding Ltd is a member of the SMI Mid (SMIM) Index.

Capital structure

A total of 27,343 shareholders were registered in Bâloise Holding Ltd's share register as at 31 December 2022. The number of registered shareholders had increased by 2.8 per cent compared with the previous year. The 'Significant shareholders' section on page 251 provides information on the structure of the Company's shareholder base as at 31 December 2022.

The reports that were submitted to the issuer and to SIX Swiss Exchange AG's disclosure office during the reporting year in compliance with article 120 of the Federal Act on Financial Market Infrastructures and Market Conduct in Secu-rities and Derivatives Trading (FinfraG) and were published on the latter's electronic reporting and publication platform in compliance with article 124 FinfraG can be viewed using the search function atwww.six-exchange-regulation.com/ en/home/publications/significant-shareholders.html.

Treasury shares

Bâloise Holding Ltd held (directly and indirectly) 311,418 treasury shares (0.7 per cent of the issued share capital) as at 31 December 2022.

Cross-shareholdings

There are no cross-shareholdings based on either capital ownership or voting rights.

2. Capital structure

Dividend policy

Bâloise Holding Ltd pursues a policy of paying consistent, earnings-related dividends. It uses other dividend instru-ments such as share buy-backs to supplement conven-tional cash dividends. Shareholders have received a total of CHF 1,994.8 million from cash dividends and share buy-backs over the last five years.

Cash dividendsShare buy-backsTotal

Year (CHF million)

2018

Total

2019

2020

2021

2022

292.8	135.1	427.9
312.3	190.0	502.3
312.3	92.8	405.1
320.6	-	320.6
338.9 1	-	338.9
1,576.9	417.9	1,994.8

All figures stated as at 31 December.

1 Proposal to the Annual General Meeting on 28 April 2023.

Bâloise Holding's equity

The table below shows the changes in equity during the last three reporting years.

Changes in Bâloise Holding Ltd's equity (before appropriation of profit)

CHF million

Share capital General reserve Reserve for treasury shares

Free reserves Distributable profit Treasury shares

Equity attributable to Bâloise Holding Ltd

31.12.2020

31.12.2021

31.12.2022

Since the capital reduction decided on 30 April 2021, the share capital of Bâloise Holding Ltd totals CHF 4.58 million and is divided into 45,800,000 dividend-bearing registered shares with a par value of CHF 0.10 each.

Authorised and conditional capital; other financing instruments Authorised capital

A resolution adopted by the Annual General Meeting on 30 April 2021 has authorised the Board of Directors until 30 April 2023 to increase the Company's share capital by up to CHF 400,000 by issuing up to 4,000,000 fully paid-up registered shares with a par value of CHF 0.10 each (see article 3 [4] of the Articles of Association). The company law reform that came into effect on 1 January 2023 replaces authorised capital with the concept of the capital band. The Annual General Meeting on 28 April 2023 will be asked to delete the provision relating to authorised capital from the Articles of Association and introduce a capital band with a floor of CHF 4,122,000 and a ceiling of CHF 5,038,000, valid until 28 April 2028.

www.baloise.com/rules-regulations

Conditional capital

Conditional capital has also been created that enables the Company's share capital to be increased by up to 5,530,715 registered shares with a par value of CHF 0.10 each (see article 3 [2] of the Articles of Association). This constitutes a nominal share capital increase of up to CHF 553,071.50.

Conditional capital is used to cover any option rights or conversion rights granted in conjunction with bonds and similar securities. Shareholders' pre-emption rights are disap-plied. Holders of the pertinent option rights and conversion rights are entitled to subscribe for the new registered shares. The Board of Directors may restrict or disapply shareholders' pre-emption rights when issuing warrant-linked bonds or convertible bonds in international capital markets (see article 3 [3] of the Articles of Association).www.baloise.com/rules-regulations

Credit rating

On 15 June 2022, the credit rating agency Standard & Poor's confirmed its rating for the Baloise Group's core companies of A + with a stable outlook. Standard & Poor's awarded this credit rating in recognition of Baloise's excellent capitalisa-tion - which is comfortably above the AAA level according to the S&P capital model - as well as its high operational profitability, robust risk management and solid compet-itive position in its profitable core markets. Information about the ratings of Bâloise Holding Ltd and its subsidiaries Baloise Belgium NV (Belgium), Baloise Sachversicherung AG (Germany), Baloise Insurance Ltd (Switzerland) and Baloise Life Ltd (Switzerland) can be found on the website.www.baloise.com/rating

3. Board of Directors

Upper limit for the disapplication of pre-emption rights

The Annual General Meeting on 28 April 2023 will be asked to include a new provision in the Articles of Association limiting to 10 per cent the total number of registered shares that will be issued from the conditional capital and from the capital band, in each case disapplying or limiting shareholders' pre-emption rights.

Other equity instruments

The Company has no profit-participation certificates.

Election and term of appointment

The Board of Directors consisted of ten members last year. Each member of the Board of Directors has been elected for a term of one year at a time. As at 31 December 2022, the average age on the Board of Directors was 58. The average term of office is 3.6 years.

The Organisational Regulations state that the term of appointment for members of the Board of Directors usually ends at the Annual General Meeting that follows the member's 70th birthday (age limit).

The Baloise Group's consolidated equity

The Baloise Group's consolidated equity amounted to CHF 4,552.1 million on 31 December 2022. Details of changes in consolidated equity in 2021 and 2022 can be found in the consolidated statement of changes in equity on pages 88 and 89 in the Financial Report. All pertinent details relating to 2020 can be found in the consolidated statement of changes in equity on page 90 in the 2021 Annual Report.

Bonds outstanding

Bâloise Holding Ltd and Baloise Life Ltd (with Bâloise Holding Ltd acting as guarantor) have issued bonds publicly. As at the end of 2022, a total of 14 public bonds were outstanding. On 19 January 2023, Bâloise Holding Ltd placed a further green bond in an amount of CHF 175 million. Details of outstanding bonds can be found on pages 210 and 249 and on the website.

www.baloise.com/bonds

Members of the Board of Directors

All members of the Board of Directors (including the Chairman) are independent and are non-executives. They were not involved in the day-to-day management of any Baloise Group companies in any of the three financial years immediately preceding the reporting period, and they maintain no mate-rial business relationships with the Baloise Group.

During the reporting year, Dr Thomas von Planta, Christoph Mäder, Christoph B. Gloor, Hugo Lasat, Dr Karin Lenzlinger Diedenhofen, Dr Markus R. Neuhaus, Professor Hans-Jörg Schmidt-Trenz and Professor Marie-Noëlle Venturi - Zen-Ruffinen were re-elected as members of the Board of Directors for a one-year term until the end of the next Annual General Meeting. Dr Maya Bundt and Claudia Dill were newly elected to the Board of Directors, also for a one-year term until the end of the next Annual General Meeting.

All members of the Board of Directors will be standing for re-election at the Annual General Meeting on 28 April 2023.

Further information on the members of the Board of Direc-tors can be found on the website.www.baloise.com/board-of-directors

Members

Prof. Dr Hans-Jörg Schmidt-Trenz, Hamburg (D)Prof. Dr Marie-Noëlle Venturi - Zen-Ruffinen, Crans-Montana

Dr Karin Lenzlinger Diedenhofen, Wermatswil Dr Markus R. Neuhaus, Zollikon

Dr Maya Bundt, Adliswil Claudia Dill, Zufikon Christoph B. Gloor, Riehen Hugo Lasat, Kessel-Lo (B)

Christoph Mäder, Vice-Chairman (since 2022), Hergiswil

Dr Thomas von Planta, Chairman (since 2021), Zurich

Strategy and Governance Committee	Investment and Risk Committee	Remune-ration Committee	Audit Committee	Nationality	Born in
C	C	CH	1961
DC	C	CH	1959
M	D/CH	1971
M	CH	1966
M	M	CH	1966
DC	B	1964
M	CH	1959
M	C	CH	1958
DC	M	D	1959
M	DC	CH	1975

C: Chair, DC: Deputy Chair, M: Member.

Appointed in

2017 2019

2022

2022

2014

2016

2021

2019

2018

2016